The big Facebook initial public offering is coming up this week. For years, FB has remained a private company, and on Friday it will take a big-boy step out into the public world to tap into what could be some serious bucks. The IPO price is currently set to $28-$35 per share, which puts Facebook’s value to as high as $96 billion. No small number. And the week before the IPO rolls out and Facebook is prepared to smash on the world of stocks, co-founder Eduardo Saverin renounces his U.S. citizenship. Why on earth would he do that, you ask? Easy. Taxes. Read what Danielle Kucera, Sanat Vallikappen, and Christine Harper for Bloomberg.com have to say about it:
“Eduardo Saverin, the billionaire co- founder of Facebook Inc. (FB), renounced his U.S. citizenship before an initial public offering that values the social network at as much as $96 billion, a move that may reduce his tax bill.
Facebook plans to raise as much as $11.8 billion through the IPO, the biggest in history for an Internet company. Saverin’s stake is about 4 percent, according to the website whoownsfacebook.com. At the high end of the proposed IPO market capitalization, that would be worth about $3.84 billion. His holdings aren’t listed in Facebook’s regulatory filings.
Saverin, 30, joins a growing number of people giving up U.S. citizenship ahead of a possible increase in tax rates for top earners. The Brazilian-born resident of Singapore is one of several people who helped Mark Zuckerberg start Facebook in a Harvard University dormitory and stand to reap billions of dollars after the world’s largest social network holds its IPO.
“Eduardo recently found it more practical to become a resident of Singapore since he plans to live there for an indefinite period of time,” said Tom Goodman, a spokesman for Saverin, in an e-mailed statement.”
To read more about the Facebook IPO, and what it means for tax purposes to give up a US citizenship, click here.
Smart move, Saverin. Smart move. Now if you all are like me, you’ll be staying tuned to see the reality of what happens when the Facebook IPO hits on Friday. Will Facebook hit the $100 billion value mark like some predict? Only time will tell.